The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Government is now aiming to announce the winning bidder for the second mobile licence next month, with the private sector “anxious” for the arrival of competition that should bring improved services and lower costs.

Although five months behind schedule, with the process having suffered several delays, the Utilities Regulation and Competition Authority (URCA) yesterday confirmed that cellular liberalisation’s auction phase had begun.

Both Cable Bahamas and Virgin Mobile (Bahamas), the two remaining players, began bidding against each other at 10am yesterday morning to acquire the wireless spectrum the winner will use to provide services to Bahamian consumers - in an auction that could raise multi-million dollar sums.

Edison Sumner, the Bahamas Chamber of Commerce and Employers Confederation’s (BCCEC) chief executive, told Tribune Business that once the auction was completed “it should not take a significant amount of time” to decide the winning bidder.

This was confirmed by the Government’s own website, which said the winning bidder would be decided by October “if everything goes to plan”.

That is five months behind the original schedule set by the Government and its Cellular Liberalisation Task Force, which had originally expected the winning bidder to be named in May, with services launched by November 2015.

That latter date will now have been pushed to April 2016 at earliest, something that will effectively give the incumbent Bahamas Telecommunications Company (BTC) and its owner, Cable & Wireless Communications (CWC), a further year of mobile monopoly - taking their post-privatisation exclusivity to five years. And either Cable Bahamas or Virgin Mobile (Bahamas) will be unlikely to roll-out truly nationwide coverage until early 2017.

Mr Sumner, who also heads IP Solutions International, a Bahamian-based communications player that ultimately decided not to bid on the second mobile licence, said he was watching whether the Government would issue a third mobile licence in two years’ time.

Speaking as the Chamber’s chief executive, he said of yesterday’s spectrum auction launch: “I think it’s about time.

“We’ve been hearing about the process of moving to this auction for quite some time. I believe the Government and Task Force are far behind the timelines originally projected. By now, we’d have expected to hear who the preferred bidder for the cellular licence was.”

With just two contenders left in the shape of BISX-listed Cable Bahamas and Virgin Mobile (Bahamas), Mr Sumner said: “It should not take URCA or the Task Force a significant amount of time to come up with who is the new provider.”

He added that the two were “bidding on what they should be paying for prime spectrum”, which has been specifically reserved by URCA, the auctioneer, for the second mobile provider.

Once the final bids are in, and the auction closed, the second and last round in the cellular liberalisation process will be completed.

URCA and the Task Force will then add up the combined scores achieved by both bidders in the auction and the first round, an evaluation of their financial and technical capabilities, and submit these and their recommendations to the Government, which will have the final say in choosing the new provider.

Describing the frequencies being fought over as “like gold spectrum”, Mr Sumner told Tribune Business: “We’re just anxious to see who comes out on top and is the next service provider, bringing a level of competition to the marketplace to increase the level of service provided and decreasing the cost of service provided.

“We’re anxious to see how that process works out, and it should not take them too long to come up with a decision as there are only two applicants.”

Mr Sumner said the benefits of mobile liberalisation, the last and most lucrative segment of the Bahamian communications market to undergo this process, would be felt by every Bahamian consumer and business.

With mobile communications having been a monopoly since they were launched in the Bahamas, the Chamber chief executive said liberalisation should reduce the cost of doing business and give consumers choice.

“We’ll have to see if the Government holds true to its promise of issuing a third licence two years after this one,” Mr Sumner told Tribune Business. “We’ll see if that is still going to be a reality.

“For the time being, we look forward to another provider coming to the market to give us a choice in who we get service from.”

David Burrows, Cable Bahamas’ marketing chief, yesterday agreed that “the real winners here are going to be the Bahamian people” as a result of the improved service, prices, products and choice created by competition.

“That’s the ultimate winner,” he told Tribune Business. “It’s been a sound and thorough process. Cable Bahamas is a Bahamian company, and we’re in it for the long haul.”

While the BISX-listed company remained confident in its prospects, Mr Burrows was unable to say how much Cable Bahamas will be bidding or when the auction is likely to end.